Financial and management issues at Erie Community College — Part II

Tuesday’s post reported on issues related to developing financial problems at Erie Community College. Today’s post explores an issue that the College is touting as a win for the school:  the contract with Canisius College for the provision of student housing at Canisius for ECC students.

The two schools see the agreement as a win-win proposition. ECC would have dorm rooms available for some of its students, while Canisius, which has empty dorm rooms because of declining enrollment, would receive some much-needed revenue. Here’s part of the announcement of the deal as reported on the Canisius website on June 6th:

Canisius College and SUNY Erie Community College (SUNY Erie) announced today that the two institutions signed a student housing agreement.  SUNY Erie will lease space for approximately 65 students in Canisius’ Delavan Townhouses (Main Street and Delavan) beginning in August for the fall academic year. The students will be matriculating at all three of SUNY Erie’s campuses. The contract provides the students with meal plans and access to all Canisius’ facilities and services…

“An agreement like this one with Canisius College emphasizes the importance of creating public-private partnerships to provide added benefits to our students,” said SUNY Erie President Dan Hocoy, Ph.D. “Offering a residential option to SUNY Erie students provides them with the opportunity to have the ‘full college experience’ and become part of a vibrant living-learning community. This is not an experience we have been able to provide our students previously.”

… SUNY Erie will add a shuttle stop at Canisius to provide a transportation option to students residing in the Delavan Townhouses.

“SUNY Erie’s focus is initially on providing access to housing for athletes and international students, but we are open to expanding that option as the demand warrants,” Hocoy noted. The agreement is for one year with the possibility of extending if both parties agree.

Hocoy is not correct in stating that “this is not an experience we have been able to provide our students previously.” The “experience” was offered on three previous occasions. The experience did not turn out well on any of those occasions.

The previous housing projects, like the one planned for this year, were mainly designed for the school’s athletes (mostly the football team). Apartments were rented in Orchard Park, Lackawanna and downtown Buffalo in those instances. In all three cases damage was done to the rented property and there were financial issues as well.

ECC does not have a residence life administrative structure, so they will rely on Canisius providing that level of supervision. ECC has reported that it

will market the housing opportunity to its students; Canisius will provide the staffing to manage housed ECC students and provide them access to meal plans, student facilities, and RA mentorship. The initial year is anticipated to house up to 65 students, but there is capacity to house up to 250 if future demand exists. ECC will only pay for the number of students actually housed at Canisius each semester in a pass through arrangement with the students. The room and board charge for those selecting housing with Canisius will be $12,500 for the academic year, or $6,250 per semester.

The 2018-19 ECC budget shows a new revenue of $812,500 related to student housing. The cost to ECC per the contract will be $12,000 per student, which totals $780,000 for 65 students. If that all holds true ECC will make a small profit on the transaction.

I recently requested and received a copy of the ECC-Canisius contract under the Freedom of Information Law. The contract was not fully executed until July 26th.

Here are some observations on what is contained in the contract:

  • Canisius will be responsible for “the assignment of all staff members and student Residents to specific apartments” and will provide all residence assistants to manage the ECC population.
  • The schools will jointly determine a part-time position to act as liaison for discipline and daily student needs.
  • ECC will pay Canisius $6,000 per semester for housing and a meal plan, payable in full once each semester within 30 days of invoicing. This appears to mean that if any ECC students fail to pay ECC for their housing costs, or if they leave before the end of a semester, ECC could be covering some of the delinquent housing costs of such students.
  • ECC will pay a $5,000 security deposit which will be used to reimburse Canisius for damage, cleaning, lost keys, etc.
  • If ECC as the tenant breaches the lease and the breach is not cured in 30 days, Canisius may terminate the lease at the end of a semester. ECC may terminate the contract “at any time upon receipt of thirty days prior written notice given by Tenant [ECC] for whatever reason.”   Contract breaches by Canisius can also lead to termination of the lease.
  • A “lack of funds” by ECC could lead to termination or renegotiation of the terms of the lease.
  • Canisius agrees to pay prevailing wages to all of its employees for work performed at the premises.
  • “Residential Facility Rules,” which are an appendix to the contract, indicate such things as violation of the alcohol policy being something that will dealt with by the Dean of Students or his/her designee. It might be assumed that the document is referring to the ECC Dean, but that is not indicated.
  • The Rules refer to “First-Year Areas” including “Perry Hall, Neumann Hall, and Porter Hall.” “Cassety Hall” and “the Moore Complex” are also referenced. There are no such named facilities at Canisius. The named halls are all residence facilities at Buffalo State College, which is not a party to this contract.
  • References are made to “the college judicial system.” ECC does not have a judicial system. The imposition of the Canisius judicial system on issues concerning ECC students could be problematic.

Stay tuned.

Coming next week

This series of posts concerning ECC will conclude next week with a report on some discretionary spending by the school’s senior management. 

Follow me on Twitter @kenkruly 

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